THE ACTIONS OF EUROPEAN CENTRAL BANK TO MAINTAIN THE PRICE STABILITY IN EUROZONE

Abstract

This article provides with the primary purpose of preserving price stability as its guidance, the Eurosystem uses a variety of strategies to accomplish its goals inside the eurozone. The EC Treaty's definition of this goal emphasizes how important it is to maintain long-term economic development and raise citizens' standards of life. A yearly rise in the Harmonized Index of Consumer Prices (HICP) for the euro area of less than 2%, to be sustained over the medium term, is the quantitative definition of price stability provided by the Eurosystem. The Eurosystem employs a multifaceted approach that integrates monetary and economic analysis in order to efficiently carry out monetary policy. Monetary analysis concentrates on the long-term links between money and prices, whereas economic analysis assesses actual activity and financial situations.